Satyam to prepay Rs300-crore loan; may lay off 5,000 employees
05 Jun 2009
Tech Mahindra, the new owner of Sataym Computer services, is reported to be in the process of repaying a Rs300 crore ($64 million) loan it had raised from state-run banks in February, even as the new Satyam board is expected to press for laying off as many as 5,000 employees of the scam-hit IT firm, in phases.
A meeting of the full board of Satyam Computer Services is likely to be held on 11 June - the first after Tech Mahindra directors assumed charge - and the board is likely to draw a consensus on the sensitive issue.
The meeting of the full board, scheduled to be held on Thursday or Friday next, will discuss the business strategies, including prepayment of the loan.
The loan is expected to be repaid from the proceeds of the share issue to new owner Tech Mahindra, reports quoting unnamed sources said.
The government-appointed board of Stayam had earlier raised the loan from Bank of Baroda and IDBI Bank to meet short-term requirements of the fraud-tainted company, the report said.
Reports also said the board will go for a consensus decision on the lay-off issue in view of the sensitivities of the matter vis-a-vis the burden of keeping 5,000-10,000 people on the reserve.
The government too is against such large-scale lay-offs given the current economic conditions.
According to Tech Mahindra CEO Vineet Nayar, Satyam has 10,000 surplus staff and the company would look at the ''least painful'' ways to handle the situation.